Canara HSBC Life Insurance raised 25.17bn rupees (US$285m) through its initial public offering, which drew strong institutional demand but opened flat at 106 rupees on Friday, October 17, before edging up 2.7% to 108.9 rupees by mid-morning, valuing the insurer at about 105.15bn rupees.
In a LinkedIn post, HSBC Life on October 20 said the successful listing enhances visibility and positions the business for substantial growth in the “vibrant Indian insurance market,” citing the country’s low insurance penetration and wide protection gap as key opportunities.
CEO Edward Moncreiffe added during the listing ceremony that the group remains committed to expanding its wealth and protection offerings in India.
The IPO was subscribed 2.29 times overall, supported mainly by qualified institutional buyers, while retail investors subscribed 42% of their quota and non-institutional investors a third, according to Reuters. The muted debut followed a string of active listings in India’s primary market, including Canara Robeco Asset Management and Tata Capital.
The insurer, jointly owned by Canara Bank and HSBC Insurance (Asia-Pacific) Holdings, was listed on both the National Stock Exchange and the Bombay Stock Exchange.
According to The Economic Times, Canara Bank on October 17 reduced its stake in the joint venture from 51% to 36.5% as part of its strategy to unlock value and expand public ownership. The divestment was executed entirely via an offer-for-sale route, with no fresh capital raised.
In April, Canara HSBC Life had filed draft papers with India’s securities regulator for its IPO, with Canara Bank, HSBC Insurance (Asia-Pacific) Holdings, and Punjab National Bank each planning to divest part of their holdings.
